Refugees on the labor market: the integration balance after five years

WITHQualifications and qualifications usually count for a lot at Thyssenkrupp. But when hundreds of thousands of refugees came to Germany from mid-2015, the industrial group, like many other companies, wanted to offer them work quickly. “If we had dealt with the typically German bureaucracy, we would not have hired a single one to date,” says Volker Grigo, Head of Training in the Steel Division.

Direct employment was rare, says Grigo. An internship or apprenticeship was almost always upstream. Thyssenkrupp filled an additional 230 internship and 150 apprenticeship positions with refugees, in almost all professions from machine plant operator to IT specialist. What followed after that? “Really a lot of work,” says Grigo.

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The constant agreements with authorities, social workers and psychologists were one thing. The other thing was familiarization with everyday training, reports Grigo: learning German, keeping up with the vocational school, getting used to German punctuality.

Although not all made it, Grigo speaks of a successful integration overall. Of the 50 apprentices he was responsible for himself, all of them are still in the company. Some are still in training, most of them have now received the annual contract that is usual for graduates. “Most of them have a perspective here in the company,” he says.

A good five years after the peak of the influx of refugees, economists also have enough data to draw an interim balance sheet for the labor market. Overall, things went better than expected given the difficult circumstances. But some indicators also show that there are persistent problems. And that the Corona crisis threatens to destroy the progress made.

What went well

The German Institute for Economic Research (DIW) in Berlin presented an overall positive result on Wednesday. The basis is representative surveys of almost 8,000 people who fled to Germany between 2013 and 2016. In 2018, 43 percent were in full or part-time employment, self-employed, in training or internship. “That is definitely a success,” says DIW researcher Felicitas Schikora. After all, those affected have only been in Germany for a few years.

The Institute for Employment Research (IAB) also published an analysis a few months ago, according to which around every second refugee has a job five years after arrival. The start into employment is therefore a little faster than with immigrants in the past.

According to the IAB, the reason is the better condition of the labor market. “In addition, significantly more has been invested in language and other integration programs for asylum seekers and recognized refugees since 2015 than was the case back then,” the report says.

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500,000 fewer vacancies

The proportion of employees subject to social security contributions is also higher than before. Wido Geis-Thöne, researcher at the employer-related Institute of German Economy (IW) in Cologne, refers to the eight most important countries of origin of asylum, Afghanistan, Eritrea, Iraq, Iran, Nigeria, Pakistan, Somalia and Syria: this was the proportion at the end of the last Year at 31 percent. “Integration into the labor market works faster and better than expected,” he says.

“We are still on the right track in integrating refugees into the labor market,” says the Federation of German Employers’ Associations (BDA). This is also thanks to the many companies that have committed themselves in recent years.

Where there are still hurdles

Conversely, however, the figures also show that more than half of the refugees have no work. According to the DIW surveys, they themselves had higher expectations of their job success. In 2016, two-thirds rated the probability of being gainfully employed two years later as high. For a third this turned out differently than hoped, but not.

Women are significantly more likely to remain unemployed than men. The IAB report had already emphasized that this is particularly true for women with small children, which is also due to a lack of external support. According to DIW researcher Schikora, disappointed expectations are a problem because they could have a negative impact on integration.

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GARBSEN, GERMANY - APRIL 26: Sheraz Chaudry (L), a refugee from Pakistan who came to Germany in 2015, attends a job training program as a electrical engineer at Campus Handwerk on April 26, 2019 in Garbsen, Germany. According to federal statistics 361,000 people from countries of origin of many of Germany's refugees had a job in 2018. And the number of refugees with jobs subject to social insurance contributions rose from 203,000 in 2017 to 298,000 in 2018. The same study claims German language deficiency remains the biggest barrier for many refugees to find a job. Germany took in over one million refugees, from countries including Syria, Afghanistan, Eritrea, Pakistan, Iran and Iraq, in 2015-2016. (Photo by Alexander Koerner/Getty Images) Getty ImagesGetty Images

Around every sixth employee from the eight countries of origin of asylum only had marginal employment, compared to less than a tenth among residents. “Even when the refugees have found their first job, the income they earn is often not enough to feed the family,” explains IW expert Geis-Thöne.

The type of work performed also plays a role. A good half of the employees subject to social security contributions from the countries of origin of asylum had helper jobs, according to IW calculations. For the total population, the value is only 16 percent.

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In order for the refugees to gain a better foothold in the labor market in the future and to be able to increasingly fill specialist positions, their qualifications must be further advanced, says Geis-Thöne. However, even then, given their often low level of education, they will probably only be able to make a limited contribution to alleviating the shortage of skilled workers.

You can see it that way at Thyssenkrupp. “For us, the program at the time was primarily a social commitment. But it is clearly not the ideal way to combat the shortage of skilled workers, ”says Grigo.

The effort to guarantee the necessary language skills and professional qualifications is too great. The Group has currently stopped creating additional training positions for refugees. You can of course still apply, but for the same places as everyone else.

Corona problems

How disadvantageous the low level of qualification is is shown particularly clearly in the current crisis situation. Because many refugees work in industries that have laid off many workers. These include, for example, temporary work and catering. Many refugees have become unemployed in these areas.

“Unfortunately, the current situation on the labor market affects refugees particularly severely because, for example, they have only recently started work or funding offers cannot take place,” says the BDA. In order for the integration to succeed, good language training and targeted qualification remained the basis.

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Those affected have to struggle with many disadvantages, says Anja Piel, member of the board of the German Trade Union Federation. Social contacts through the workplace, school or civil society initiatives no longer take place.

“For many families with children, especially those who still have to live in shared accommodation, homeschooling is out of the question,” says Piel. “For refugees for whom employment or training is the basis for their stay in Germany, the loss of jobs is threatening their existence.” Learning from Corona also means improving integration into society and the labor market.

“Another problem is that recognized refugees initially only have a safe stay for one to three years,” says the union. Then they are re-examined. That is the reason for the above-average frequency of employment in precarious conditions. “In order to break this vicious circle of dependency, the possibility of an unlimited residence permit must be given after one year of residence at the latest,” she says.

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Also in the trade, where many refugees work and are trained, reference is made to enormous corona restrictions. The Central Association of German Crafts (ZDH) reports that it is “extremely difficult and sometimes even impossible to recruit new applicants” because of the contact restrictions and canceled events.

In some cases, however, there could be positive effects, it is said. Unemployed workers, who were the first to suffer from the consequences of the crisis, would now sometimes see the value of real training. IW researcher Geis-Thöne also believes that it is likely that the damage will not last. When the crisis is over, he says, refugee employment could soon be back above 2019 levels.

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